Indorsement and Payment of Checks Drawn on the United States Treasury, 57907-57910 [2011-23896]
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Federal Register / Vol. 76, No. 181 / Monday, September 19, 2011 / Rules and Regulations
§ 522.1014
Gamithromycin.
(a) Specifications. Each milliliter (mL)
of solution contains 150 milligrams (mg)
gamithromycin.
(b) Sponsor. See No. 050604 in
§ 510.600(c) of this chapter.
(c) Related tolerances. See § 556.292
of this chapter.
(d) Conditions of use—(1) Cattle—(i)
Amount. Administer 6 mg/kilogram of
body weight (2 mL per 110 pounds) one
time by subcutaneous injection in the
neck.
(ii) Indications for use. For the
treatment of bovine respiratory disease
(BRD) associated with Mannheimia
haemolytica, Pasteurella multocida, and
Histophilus somni in beef and nonlactating dairy cattle; and for the control
of respiratory disease in beef and nonlactating dairy cattle at high risk of
developing BRD associated with M.
haemolytica and P. multocida.
(iii) Limitations. Cattle intended for
human consumption must not be
slaughtered within 35 days from the last
treatment. Do not use in female dairy
cattle 20 months of age or older. A
withdrawal period has not been
established for this product in
preruminating calves. Do not use in
calves to be processed for veal. Federal
law restricts this drug to use by or on
the order of a licensed veterinarian.
(2) [Reserved]
PART 556—TOLERANCES FOR
RESIDUES OF NEW ANIMAL DRUGS
IN FOOD
3. The authority citation for 21 CFR
part 556 continues to read as follows:
■
Authority: 21 U.S.C. 342, 360b, 371.
4. Section 556.292 is added to read as
follows:
■
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§ 556.292
Gamithromycin.
(a) Acceptable Daily Intake (ADI). The
ADI for total residues of gamithromycin
is 10 micrograms per kilogram of body
weight per day.
(b) Tolerances. The tolerances for
gamithromycin (the marker residue) are:
(1) Cattle—(i) Liver (the target tissue):
500 parts per billion (ppb).
(ii) Muscle. 150 ppb.
(2) [Reserved]
(c) Related conditions of use. See
§ 522.1014 of this chapter.
Dated: September 13, 2011.
Bernadette Dunham,
Director, Center for Veterinary Medicine.
[FR Doc. 2011–23874 Filed 9–16–11; 8:45 am]
BILLING CODE 4160–01–P
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57907
Food and Drug Administration
it is a rule of ‘‘particular applicability.’’
Therefore, it is not subject to the
congressional review requirements in 5
U.S.C. 801–808.
21 CFR Part 556
List of Subjects in 21 CFR Part 556
DEPARTMENT OF HEALTH AND
HUMAN SERVICES
[Docket No. FDA–2011–N–0003]
Tolerances for Residues of New
Animal Drugs in Food; Progesterone
AGENCY:
Food and Drug Administration,
HHS.
Final rule; technical
amendment.
Animal drugs, Foods.
Therefore, under the Federal Food,
Drug, and Cosmetic Act and under
authority delegated to the Commissioner
of Food and Drugs and redelegated to
the Center for Veterinary Medicine, 21
CFR part 556 is amended as follows:
ACTION:
The Food and Drug
Administration (FDA) is amending the
animal drug regulations to update the
allowable incremental increase for
residues of progesterone in edible
tissues of cattle and sheep based on the
1994 revised daily consumption values.
This action is being taken to improve
the accuracy of the regulations.
DATES: This rule is effective September
19, 2011.
FOR FURTHER INFORMATION CONTACT:
Kevin Gaido, Center for Veterinary
Medicine (HFV–153), Food and Drug
Administration, 7500 Standish Pl.,
Rockville, MD 20855, 240–276–8212, email: kevin.gaido@fda.hhs.gov.
SUPPLEMENTARY INFORMATION: Section
512(i) of the Federal Food, Drug, and
Cosmetic Act (21 U.S.C. 360b(i)) (21
CFR 514.105(a)) directs FDA to establish
tolerances by regulation, as necessary,
when a new animal drug is approved for
use in food-producing animals.
Progesterone is approved for use in
subcutaneous implants used for
increased rate of weight gain in suckling
beef calves and steers (21 CFR 522.1940)
and in vaginal inserts used for
management of the estrous cycle in
female cattle and ewes (21 CFR
529.1940).
FDA has noticed the animal drug
tolerance regulations do not reflect
levels for progesterone using the daily
consumption values in the current
guidance document, ‘‘Guideline for
Establishing a Safe Concentration’’ (59
FR 37499, July 22, 1994). At this time,
FDA is amending 21 CFR 556.540 to
reflect the revised daily consumption
values as applied to edible tissues of
cattle. Sheep are considered a minor
species for human food safety
assessment, and the updated allowable
incremental increase limits for cattle
tissues based on the revised daily
consumption values are applicable to
sheep. This action is being taken to
improve the accuracy of the regulations.
This rule does not meet the definition
of ‘‘rule’’ in 5 U.S.C. 804(3)(A) because
SUMMARY:
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PART 556—TOLERANCES FOR
RESIDUES OF NEW ANIMAL DRUGS
IN FOOD
1. The authority citation for 21 CFR
part 556 continues to read as follows:
■
Authority: 21 U.S.C. 342, 360b, 371.
■
2. Revise § 556.540 to read as follows:
§ 556.540
Progesterone.
(a) [Reserved]
(b) Tolerances. Residues of
progesterone are not permitted in excess
of the following increments above the
concentrations of progesterone naturally
present in untreated animals:
(1) Cattle and sheep—(i) Muscle: 5
parts per billion (ppb).
(ii) Liver: 15 ppb.
(iii) Kidney: 30 ppb.
(iv) Fat: 30 ppb.
(2) [Reserved]
(c) Related conditions of use. See
§§ 522.1940 and 529.1940 of this
chapter.
Dated: September 13, 2011.
Bernadette Dunham,
Director, Center for Veterinary Medicine.
[FR Doc. 2011–23867 Filed 9–16–11; 8:45 am]
BILLING CODE 4160–01–P
DEPARTMENT OF THE TREASURY
Fiscal Service
31 CFR Part 240
RIN 1510–AB25
Indorsement and Payment of Checks
Drawn on the United States Treasury
Financial Management Service,
Fiscal Service, Treasury.
ACTION: Final rule.
AGENCY:
This final rule authorizes the
Department of the Treasury (Treasury),
Financial Management Service (FMS),
to direct Federal Reserve Banks to debit
a financial institution’s Master Account
for all check reclamations against the
financial institution that the financial
institution has not protested. Financial
SUMMARY:
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Federal Register / Vol. 76, No. 181 / Monday, September 19, 2011 / Rules and Regulations
institutions will continue to have the
right to file a protest with FMS if they
believe a proposed reclamation is in
error.
DATES: This rule is effective October 19,
2011.
FOR FURTHER INFORMATION CONTACT:
Sandra Walls, Reclamation Branch
Manager, Check Resolution Division, at
(202) 874–7945 or
sandra.walls@fms.treas.gov; or William
J. Erle, Senior Counsel, at (202) 874–
6975 or william.erle@fms.treas.gov.
SUPPLEMENTARY INFORMATION:
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I. Background
The Department of the Treasury
(Treasury), Financial Management
Service (FMS),1 is amending its
regulation at 31 CFR part 240 (Part 240),
governing the indorsement and payment
of checks drawn on the United States
Treasury. Part 240 sets forth how checks
may be indorsed and the remedies
available to Treasury when checks are
improperly negotiated. The rule
provides for the allocation of loss
between the Government and indorsers
of the check. In addition, Part 240
provides information on how Treasury
will collect debts owed by financial
institutions and other indorsers when
they fail to pay check reclamations
made by Treasury.
On January 4, 2010, Treasury issued
a notice of proposed rulemaking
(NPRM) requesting comments on its
proposal to provide Treasury with the
authority to direct Federal Reserve
Banks to debit a financial institution’s
Master Account for all check
reclamations for which the financial
institution has not submitted a valid
protest with supporting documentation.
See 75 FR 95. The proposed rule
explained that FMS will notify the
financial institution of the reclamation
by sending a NOTICE OF DIRECT
DEBIT (RECLAMATION), which also
will inform the financial institution
that, if the reclamation is not paid by
the 30th day after the direct debit notice
date, the financial institution’s Master
Account will be debited by its servicing
Federal Reserve Bank.
II. Discussion of Comments
FMS received two comments on the
proposed rule—one from a financial
institution and one from a banking
association. Both commenters indicated
that the proposed 30-day notice period
before a direct debit is carried out was
too short. Rather, they suggested that
1 FMS is the bureau within Treasury charged with
implementing Treasury’s authority in this area. The
terms Treasury and FMS are used interchangeably
in this rule.
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FMS provide a financial institution with
notice 60 days before directing the
Federal Reserve to debit the financial
institution’s Master Account. FMS
carefully considered this comment and
decided to keep the proposed 30-day
notice period. Currently 95% of all
Treasury reclamations are already paid
by financial institutions within 30 days.
An extended processing time would not
be consistent with the goal of the
revised regulation—to expedite and
streamline the process of collecting
unpaid reclamations. When a financial
institution has reason to believe the
reclamation direct debit should not
proceed, it may file a protest.
Both commenters indicated that FMS
should clarify which account will be
debited in a reclamation direct debit.
They pointed out that the NPRM refers
to both an ‘‘account’’ and a ‘‘reserve
account.’’ FMS agrees that this point
should be clarified. Therefore, the final
rule includes a new definition for
‘‘Master Account’’ that mirrors the
definition found in Federal Reserve
Banks Operating Circular 1.
Additionally, throughout the rule,
‘‘reserve account’’ and ‘‘account’’ have
been replaced with ‘‘Master Account.’’
Although not a direct comment on the
proposed rule, both commenters
expressed concern with the amount of
time FMS takes to process reclamation
protests. In response to this concern,
FMS notes that it routinely exceeds the
goal set forth in Part 240: that FMS will
make every effort to decide a properly
submitted protest within 60 days. In
fiscal year 2010, 85% of bank protests
received were resolved within 30 days.
Still, some complicated protests take
longer to resolve. FMS will continue to
work diligently to make final decisions
as quickly as possible. Contrary to one
commenter’s assertion, FMS maintains a
reclamations Web page (https://
www.fms.treas.gov/goldbook) that
provides a telephone number, a
facsimile number, an e-mail address,
and a mailing address for financial
institutions to use to get information
about their protests.
Finally, one commenter asked FMS to
include in the final rule requirements
for refund transaction processing. The
commenter was concerned that, in the
event FMS provides a refund for a
reclamation payment, the refund may
include interest and penalties already
paid by the financial institution in
addition to the original reclamation
debt. To maintain accurate accounting
for refund transactions, the commenter
asked FMS to provide more information
about the refund amount and to include
the requirements for refund transaction
processing in the final rule. Currently,
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on the check issued in settlement for a
bank protest, FMS prints ‘‘refund for
check #XXXX–XX,XXX,XXX’’ to aid the
financial institution in cross-referencing
against their reclamation records. After
direct debiting has been instituted, FMS
will begin to make changes to its
systems to allow electronic refunds via
credit to the financial institution’s
Master Account. FMS believes that more
information about the refund amount is
not necessary because normally,
penalties, administrative fees, and
interest will not be assessed since the
debit will occur on the 31st day after the
reclamation date.
III. Clarifications and Technical
Corrections
FMS is amending § 240.9(b)(3)(ii) to
clarify that Treasury must receive a
reclamation protest within 60 days after
the reclamation date. The NPRM
specified that if a financial institution
files a reclamation protest within 30
days after the reclamation date,
Treasury would not instruct the Federal
Reserve Bank to debit the financial
institution’s Master Account. See
§ 240.9(a)(1)(iii). The preamble to the
NPRM specified that a financial
institution has an additional 30 days
after the direct debit date to submit a
reclamation protest. To provide for a 30day period before direct debit and a 30day period after direct debit,
§ 240.9(b)(3)(ii) is amended to specify a
total of 60 days after the reclamation
date.
Throughout the rule, the term
‘‘Director, Financial Processing
Division,’’ is replaced with ‘‘responsible
FMS Director.’’ This change allows the
rule to remain accurate should reorganizations occur.
Sections 240.9(a)(2) and 240.9(b)(3)
are revised to update the mailing
address for submitting a request to
inspect Treasury records, to submit a
repayment agreement, or to submit a
reclamation protest. The rule is revised
to provide addresses through the Check
Claims Web site or the Goldbook: The
Check Reclamation Guide.
Sections 240.9(a)(1)(i) and (iii), and
240.9(b)(4)(iii) are revised to replace the
words ‘‘of’’ and ‘‘from’’ with the word
‘‘after,’’ to make it clear that a financial
institution has 30 days after the
reclamation date to pay the reclamation
debt or file a protest before Treasury
instructs the Federal Reserve Bank to
debit the financial institution’s Master
Account. Therefore, the debit will occur
on the 31st day after the reclamation
date.
This Final Rule also corrects the
NPRM by spelling the word
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‘‘indorsement’’ with an ‘‘i’’ wherever it
appears.
IV. Procedural Analyses
Regulatory Planning and Review
The final rule does not meet the
criteria for a ‘‘significant regulatory
action’’ as defined in Executive Order
12866. Therefore, the regulatory review
procedures contained therein do not
apply.
Regulatory Flexibility Act Analysis
It is hereby certified that the rule will
not have a significant economic impact
on a substantial number of small
entities. This rule would eliminate
certain administrative fees and interest
and penalty charges in order to
streamline and automate reclamation
procedures. The changes to the
regulation related to automating
reclamations should have a minimal
economic impact on small financial
institutions and in fact, may reduce
some costs for financial institutions
affected by the changes. Accordingly, a
regulatory flexibility analysis under the
Regulatory Flexibility Act (5 U.S.C. 601
et seq.) is not required.
List of Subjects in 31 CFR Part 240
Banks, Banking, Checks, Counterfeit
checks, Federal Reserve system,
Forgery, and Guarantees.
For the reasons set forth in the
preamble, we are amending 31 CFR part
240 as follows:
PART 240—INDORSEMENT AND
PAYMENT OF CHECKS DRAWN ON
THE UNITED STATES TREASURY
1. The authority citation for part 240
continues to read as follows:
■
Authority: 5 U.S.C. 301; 12 U.S.C. 391; 31
U.S.C. 321, 3327, 3328, 3331, 3334, 3343,
3711, 3712, 3716, 3717; 332 U.S. 234 (1947);
318 U.S. 363 (1943).
2. In part 240 revise all references to
‘‘the Director, Financial Processing
Division’’ and ‘‘the Director of the
Financial Processing Division’’
wherever they appear to read ‘‘the
responsible FMS Director’’.
■
3. In § 240.1, add paragraph (d) to read
as follows:
■
§ 240.1
Scope of regulations.
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*
*
*
*
*
(d) A financial institution’s
indorsement or presentment of a U.S.
Treasury check shall constitute its
agreement to this part. The financial
institution hereby authorizes its
servicing Federal Reserve Bank to debit
the financial institution’s Federal
Reserve Master Account for the amount
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of the reclamation and any accrued
interest, penalties and/or administrative
costs in accordance with the provisions
of § 240.9.
4. In § 240.2, redesignate paragraphs
(t) through (mm) as (u) through (nn),
and add new paragraph (t) to read as
follows:
■
§ 240.2
Definitions.
*
*
*
*
*
(t) Master Account means the record
of financial rights and obligations of an
account holder and the Federal Reserve
Bank with respect to each other, where
opening, intraday, and closing balances
are determined.
*
*
*
*
*
5. In § 240.9, revise paragraphs (a),
(b)(3) introductory text, (b)(3)(ii), and
(b)(4)(iii) to read as follows:
■
§ 240.9 Reclamation procedures;
reclamation protests.
(a) Reclamation procedures. (1)
Treasury will send a ‘‘NOTICE OF
DIRECT DEBIT (RECLAMATION)’’ to
the reclamation debtor in accordance
with § 240.8(a). This notice will advise
the reclamation debtor of the amount
demanded and the reason for the
demand. Treasury will provide notice to
the reclamation debtor that:
(i) If the reclamation debt is not paid
within 30 days after the reclamation
date, Treasury intends to collect the
amount outstanding by instructing the
appropriate Federal Reserve Bank to
debit on the 31st day the Master
Account used by the reclamation debtor.
The Federal Reserve Bank will provide
advice of the debit to the reclamation
debtor;
(ii) The reclamation debtor has an
opportunity to inspect and copy
Treasury’s records with respect to the
reclamation debt;
(iii) The reclamation debtor may, by
filing a protest in accordance with
§ 240.9(b), request Treasury to review its
decision that the reclamation debtor is
liable for the reclamation debt. If such
a protest is filed within 30 days after the
reclamation date, Treasury will not
instruct the appropriate Federal Reserve
Bank to debit the Master Account used
by the reclamation debtor while the
protest is still pending; and
(iv) The reclamation debtor has an
opportunity to enter into a written
agreement with Treasury for the
repayment of the reclamation debt. A
request for a repayment agreement must
be accompanied by documentary proof
that satisfies Treasury that the
reclamation debtor is unable to repay
the entire amount owed when due.
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57909
(2) Requests by a reclamation debtor
for an appointment to inspect and copy
Treasury’s records with respect to a
reclamation debt and requests to enter
into repayment agreements must be sent
in writing to the address provided on
the Check Claims Web site at https://
www.fms.treas.gov/checkclaims or to
such other address as Treasury may
publish in the Goldbook: The Check
Reclamation Guide, which can be found
at https://www.fms.treas.gov.
(3) If Treasury determines a
reclamation debt is due and the Federal
Reserve Bank is unable to debit the
financial institution’s Master Account,
FMS will assess interest, penalties, and
administrative costs in accordance with
§ 240.8. Additionally, Treasury will
proceed to collect the reclamation debt
through offset in accordance with
§ 240.10 and Treasury Check Offset in
accordance with § 240.11.
(4) If Treasury determines a
reclamation has been made in error,
Treasury will abandon the reclamation.
If Treasury already has collected the
amount of the reclamation from the
reclamation debtor, Treasury will
promptly refund to the reclamation
debtor the amount of its payment.
(b) * * *
(3) Procedures for filing a protest. A
reclamation protest must be sent in
writing to the address provided on the
Check Claims Web site at https://
www.fms.treas.gov/checkclaims or to
such other address as Treasury may
publish in the Goldbook: The Check
Reclamation Guide, which can be found
at https://www.fms.treas.gov.
*
*
*
*
*
(ii) Treasury will not consider
reclamation protests received more than
60 days after the reclamation date.
*
*
*
*
*
(4) * * *
(iii) If the responsible FMS Director,
or an authorized designee, finds, by a
preponderance of the evidence, the
reclamation debtor is liable for the
reclamation debt, Treasury will notify
the reclamation debtor of his or her
decision in writing. If the reclamation
debtor has not paid the reclamation in
full, Treasury will direct the Federal
Reserve Bank to debit the financial
institution’s Master Account
immediately, provided at least 30 days
have passed after the date of the
NOTICE OF DIRECT DEBIT
(RECLAMATION). If at least 30 days
have not yet passed after the date of the
NOTICE OF DIRECT DEBIT
(RECLAMATION), Treasury will direct
the Federal Reserve Bank to debit the
financial institution’s Master Account
on the 31st day after the date of the
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NOTICE OF DIRECT DEBIT
(RECLAMATION). The Federal Reserve
Bank will provide advice of the debit to
the reclamation debtor. If the
appropriate Federal Reserve Bank is
unable to debit a reclamation debtor’s
Master Account, Treasury will proceed
to collect the reclamation debt through
offset in accordance with § 240.10 and
§ 240.11.
*
*
*
*
*
Dated: September 12, 2011.
Richard L. Gregg,
Fiscal Assistant Secretary.
[FR Doc. 2011–23896 Filed 9–16–11; 8:45 am]
BILLING CODE 4810–35–P
DEPARTMENT OF HOMELAND
SECURITY
Coast Guard
33 CFR Part 165
[Docket No. USCG–2011–0868]
RIN 1625–AA11
Regulated Navigation Area; Route 24
Bridge Construction, Tiverton and
Portsmouth, RI
Coast Guard, DHS.
Temporary interim rule with
request for comments.
AGENCY:
ACTION:
The Coast Guard is
establishing a regulated navigation area
(RNA) on the navigable waters of the
Sakonnet River under and surrounding
construction of the new Route 24 bridge
that crosses the Sakonnet River between
Tiverton and Portsmouth, Rhode Island.
This rule implements certain safety
measures including establishment of a
temporary channel beneath the bridge,
speed restrictions, and suspension of all
vessel traffic within the RNA during
construction operations that could pose
an imminent hazard to vessels operating
in the area. This rule is necessary to
provide for the safety of life on the
navigable waters during construction of
the Route 24 bridge over the main
channel of the Sakonnet River.
DATES: This rule is effective on
September 19, 2011 until 11:59 p.m. on
May 1, 2013. This rule is effective with
actual notice for purposes of
enforcement from 8 a.m. on September
9, 2011, until 11:59 p.m. on May 1,
2013. Public comments may be
submitted throughout the effective
period.
ADDRESSES: You may submit comments
identified by docket number USCG–
2011–0868 using any one of the
following methods:
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SUMMARY:
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• Federal e-Rulemaking Portal:
https://www.regulations.gov.
• Fax: 202–493–2251.
• Mail: Docket Management Facility
(M–30), U.S. Department of
Transportation, West Building Ground
Floor, Room W12–140, 1200 New Jersey
Avenue, SE., Washington, DC 20590–
0001.
• Hand Delivery: Same as mail
address above, between 9 a.m. and 5
p.m., Monday through Friday, except
Federal holidays. The telephone number
is 202–366–9329.
To avoid duplication, please use only
one of these four methods. See the
‘‘Public Participation and Request for
Comments’’ portion of the
SUPPLEMENTARY INFORMATION section
below for instructions on submitting
comments.
Documents indicated in this preamble
as being available in the docket are part
of docket USCG–2011–0868 and are
available online by going to https://
www.regulations.gov, inserting USCG–
2011–0868 in the ‘‘Keyword’’ box, and
then clicking ‘‘Search.’’ They are also
available for inspection or copying at
the Docket Management Facility (M–30),
U.S. Department of Transportation,
West Building Ground Floor, Room
W12–140, 1200 New Jersey Avenue, SE.,
Washington, DC 20590, between 9 a.m.
and 5 p.m., Monday through Friday,
except Federal holidays.
FOR FURTHER INFORMATION CONTACT: If
you have questions on this temporary
rule, call or e-mail Mr. Edward G.
LeBlanc, Chief of the Waterways
Management Division, U.S. Coast Guard
Sector Southeastern New England;
telephone 401–435–2351, e-mail
Edward.G.LeBlanc@uscg.mil, or
Lieutenant Junior Grade Isaac Slavitt,
Coast Guard First District Waterways
Management Branch, telephone 617–
223–8385, e-mail
Isaac.M.Slavitt@uscg.mil. If you have
questions on viewing the docket, call
Renee V. Wright, Program Manager,
Docket Operations, telephone 202–366–
9826.
SUPPLEMENTARY INFORMATION:
Public Participation and Request for
Comments
We encourage you to participate in
this rulemaking by submitting
comments and related materials. All
comments received will be posted,
without change, to https://
www.regulations.gov and will include
any personal information you have
provided.
As this temporary interim rule will be
in effect before the end of the comment
period, the Coast Guard will evaluate
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and revise this rule as necessary to
address significant public comments.
Submitting Comments
If you submit a comment, please
include the docket number for this
rulemaking (USCG–2011–0868),
indicate the specific section of this
document to which each comment
applies, and provide a reason for each
suggestion or recommendation. You
may submit your comments and
material online (via https://
www.regulations.gov) or by fax, mail, or
hand delivery, but please use only one
of these means. If you submit a
comment online via https://
www.regulations.gov, it will be
considered received by the Coast Guard
when you successfully transmit the
comment. If you fax, hand deliver, or
mail your comment, it will be
considered as having been received by
the Coast Guard when it is received at
the Docket Management Facility. We
recommend that you include your name
and a mailing address, an e-mail
address, or a telephone number in the
body of your document so that we can
contact you if we have questions
regarding your submission.
To submit your comment online, go to
https://www.regulations.gov, click on the
‘‘submit a comment’’ box, which will
then become highlighted in blue. In the
‘‘Document Type’’ drop down menu
select ‘‘Proposed Rule’’ and insert
‘‘USCG–2011–0868’’ in the ‘‘Keyword’’
box. Click ‘‘Search’’ then click on the
balloon shape in the ‘‘Actions’’ column.
If you submit comments by mail or hand
delivery, submit them in an unbound
format, no larger than 81⁄2 by 11 inches,
suitable for copying and electronic
filing. If you submit comments by mail
and would like to know that they
reached the Facility, please enclose a
stamped, self-addressed postcard or
envelope. We will consider all
comments and material received during
the comment period and may change
this rule based on your comments.
Viewing Comments and Documents
To view comments, as well as
documents mentioned in this preamble
as being available in the docket, go to
https://www.regulations.gov, click on the
‘‘read comments’’ box, which will then
become highlighted in blue. In the
‘‘Keyword’’ box insert ‘‘USCG–2011–
0868’’ and click ‘‘Search.’’ Click the
‘‘Open Docket Folder’’ in the ‘‘Actions’’
column. You may also visit the Docket
Management Facility in Room W12–140
on the ground floor of the Department
of Transportation West Building, 1200
New Jersey Avenue, SE., Washington,
DC 20590, between 9 a.m. and 5 p.m.,
E:\FR\FM\19SER1.SGM
19SER1
]]>Agencies
[Federal Register Volume 76, Number 181 (Monday, September 19, 2011)]
[Rules and Regulations]
[Pages 57907-57910]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2011-23896]
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DEPARTMENT OF THE TREASURY
Fiscal Service
31 CFR Part 240
RIN 1510-AB25
Indorsement and Payment of Checks Drawn on the United States
Treasury
AGENCY: Financial Management Service, Fiscal Service, Treasury.
ACTION: Final rule.
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SUMMARY: This final rule authorizes the Department of the Treasury
(Treasury), Financial Management Service (FMS), to direct Federal
Reserve Banks to debit a financial institution's Master Account for all
check reclamations against the financial institution that the financial
institution has not protested. Financial
[[Page 57908]]
institutions will continue to have the right to file a protest with FMS
if they believe a proposed reclamation is in error.
DATES: This rule is effective October 19, 2011.
FOR FURTHER INFORMATION CONTACT: Sandra Walls, Reclamation Branch
Manager, Check Resolution Division, at (202) 874-7945 or
sandra.walls@fms.treas.gov; or William J. Erle, Senior Counsel, at
(202) 874-6975 or william.erle@fms.treas.gov.
SUPPLEMENTARY INFORMATION:
I. Background
The Department of the Treasury (Treasury), Financial Management
Service (FMS),\1\ is amending its regulation at 31 CFR part 240 (Part
240), governing the indorsement and payment of checks drawn on the
United States Treasury. Part 240 sets forth how checks may be indorsed
and the remedies available to Treasury when checks are improperly
negotiated. The rule provides for the allocation of loss between the
Government and indorsers of the check. In addition, Part 240 provides
information on how Treasury will collect debts owed by financial
institutions and other indorsers when they fail to pay check
reclamations made by Treasury.
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\1\ FMS is the bureau within Treasury charged with implementing
Treasury's authority in this area. The terms Treasury and FMS are
used interchangeably in this rule.
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On January 4, 2010, Treasury issued a notice of proposed rulemaking
(NPRM) requesting comments on its proposal to provide Treasury with the
authority to direct Federal Reserve Banks to debit a financial
institution's Master Account for all check reclamations for which the
financial institution has not submitted a valid protest with supporting
documentation. See 75 FR 95. The proposed rule explained that FMS will
notify the financial institution of the reclamation by sending a NOTICE
OF DIRECT DEBIT (RECLAMATION), which also will inform the financial
institution that, if the reclamation is not paid by the 30th day after
the direct debit notice date, the financial institution's Master
Account will be debited by its servicing Federal Reserve Bank.
II. Discussion of Comments
FMS received two comments on the proposed rule--one from a
financial institution and one from a banking association. Both
commenters indicated that the proposed 30-day notice period before a
direct debit is carried out was too short. Rather, they suggested that
FMS provide a financial institution with notice 60 days before
directing the Federal Reserve to debit the financial institution's
Master Account. FMS carefully considered this comment and decided to
keep the proposed 30-day notice period. Currently 95% of all Treasury
reclamations are already paid by financial institutions within 30 days.
An extended processing time would not be consistent with the goal of
the revised regulation--to expedite and streamline the process of
collecting unpaid reclamations. When a financial institution has reason
to believe the reclamation direct debit should not proceed, it may file
a protest.
Both commenters indicated that FMS should clarify which account
will be debited in a reclamation direct debit. They pointed out that
the NPRM refers to both an ``account'' and a ``reserve account.'' FMS
agrees that this point should be clarified. Therefore, the final rule
includes a new definition for ``Master Account'' that mirrors the
definition found in Federal Reserve Banks Operating Circular 1.
Additionally, throughout the rule, ``reserve account'' and ``account''
have been replaced with ``Master Account.''
Although not a direct comment on the proposed rule, both commenters
expressed concern with the amount of time FMS takes to process
reclamation protests. In response to this concern, FMS notes that it
routinely exceeds the goal set forth in Part 240: that FMS will make
every effort to decide a properly submitted protest within 60 days. In
fiscal year 2010, 85% of bank protests received were resolved within 30
days. Still, some complicated protests take longer to resolve. FMS will
continue to work diligently to make final decisions as quickly as
possible. Contrary to one commenter's assertion, FMS maintains a
reclamations Web page (https://www.fms.treas.gov/goldbook) that provides
a telephone number, a facsimile number, an e-mail address, and a
mailing address for financial institutions to use to get information
about their protests.
Finally, one commenter asked FMS to include in the final rule
requirements for refund transaction processing. The commenter was
concerned that, in the event FMS provides a refund for a reclamation
payment, the refund may include interest and penalties already paid by
the financial institution in addition to the original reclamation debt.
To maintain accurate accounting for refund transactions, the commenter
asked FMS to provide more information about the refund amount and to
include the requirements for refund transaction processing in the final
rule. Currently, on the check issued in settlement for a bank protest,
FMS prints ``refund for check XXXX-XX,XXX,XXX'' to aid the
financial institution in cross-referencing against their reclamation
records. After direct debiting has been instituted, FMS will begin to
make changes to its systems to allow electronic refunds via credit to
the financial institution's Master Account. FMS believes that more
information about the refund amount is not necessary because normally,
penalties, administrative fees, and interest will not be assessed since
the debit will occur on the 31st day after the reclamation date.
III. Clarifications and Technical Corrections
FMS is amending Sec. 240.9(b)(3)(ii) to clarify that Treasury must
receive a reclamation protest within 60 days after the reclamation
date. The NPRM specified that if a financial institution files a
reclamation protest within 30 days after the reclamation date, Treasury
would not instruct the Federal Reserve Bank to debit the financial
institution's Master Account. See Sec. 240.9(a)(1)(iii). The preamble
to the NPRM specified that a financial institution has an additional 30
days after the direct debit date to submit a reclamation protest. To
provide for a 30-day period before direct debit and a 30-day period
after direct debit, Sec. 240.9(b)(3)(ii) is amended to specify a total
of 60 days after the reclamation date.
Throughout the rule, the term ``Director, Financial Processing
Division,'' is replaced with ``responsible FMS Director.'' This change
allows the rule to remain accurate should re-organizations occur.
Sections 240.9(a)(2) and 240.9(b)(3) are revised to update the
mailing address for submitting a request to inspect Treasury records,
to submit a repayment agreement, or to submit a reclamation protest.
The rule is revised to provide addresses through the Check Claims Web
site or the Goldbook: The Check Reclamation Guide.
Sections 240.9(a)(1)(i) and (iii), and 240.9(b)(4)(iii) are revised
to replace the words ``of'' and ``from'' with the word ``after,'' to
make it clear that a financial institution has 30 days after the
reclamation date to pay the reclamation debt or file a protest before
Treasury instructs the Federal Reserve Bank to debit the financial
institution's Master Account. Therefore, the debit will occur on the
31st day after the reclamation date.
This Final Rule also corrects the NPRM by spelling the word
[[Page 57909]]
``indorsement'' with an ``i'' wherever it appears.
IV. Procedural Analyses
Regulatory Planning and Review
The final rule does not meet the criteria for a ``significant
regulatory action'' as defined in Executive Order 12866. Therefore, the
regulatory review procedures contained therein do not apply.
Regulatory Flexibility Act Analysis
It is hereby certified that the rule will not have a significant
economic impact on a substantial number of small entities. This rule
would eliminate certain administrative fees and interest and penalty
charges in order to streamline and automate reclamation procedures. The
changes to the regulation related to automating reclamations should
have a minimal economic impact on small financial institutions and in
fact, may reduce some costs for financial institutions affected by the
changes. Accordingly, a regulatory flexibility analysis under the
Regulatory Flexibility Act (5 U.S.C. 601 et seq.) is not required.
List of Subjects in 31 CFR Part 240
Banks, Banking, Checks, Counterfeit checks, Federal Reserve system,
Forgery, and Guarantees.
For the reasons set forth in the preamble, we are amending 31 CFR
part 240 as follows:
PART 240--INDORSEMENT AND PAYMENT OF CHECKS DRAWN ON THE UNITED
STATES TREASURY
0
1. The authority citation for part 240 continues to read as follows:
Authority: 5 U.S.C. 301; 12 U.S.C. 391; 31 U.S.C. 321, 3327,
3328, 3331, 3334, 3343, 3711, 3712, 3716, 3717; 332 U.S. 234 (1947);
318 U.S. 363 (1943).
0
2. In part 240 revise all references to ``the Director, Financial
Processing Division'' and ``the Director of the Financial Processing
Division'' wherever they appear to read ``the responsible FMS
Director''.
0
3. In Sec. 240.1, add paragraph (d) to read as follows:
Sec. 240.1 Scope of regulations.
* * * * *
(d) A financial institution's indorsement or presentment of a U.S.
Treasury check shall constitute its agreement to this part. The
financial institution hereby authorizes its servicing Federal Reserve
Bank to debit the financial institution's Federal Reserve Master
Account for the amount of the reclamation and any accrued interest,
penalties and/or administrative costs in accordance with the provisions
of Sec. 240.9.
0
4. In Sec. 240.2, redesignate paragraphs (t) through (mm) as (u)
through (nn), and add new paragraph (t) to read as follows:
Sec. 240.2 Definitions.
* * * * *
(t) Master Account means the record of financial rights and
obligations of an account holder and the Federal Reserve Bank with
respect to each other, where opening, intraday, and closing balances
are determined.
* * * * *
0
5. In Sec. 240.9, revise paragraphs (a), (b)(3) introductory text,
(b)(3)(ii), and (b)(4)(iii) to read as follows:
Sec. 240.9 Reclamation procedures; reclamation protests.
(a) Reclamation procedures. (1) Treasury will send a ``NOTICE OF
DIRECT DEBIT (RECLAMATION)'' to the reclamation debtor in accordance
with Sec. 240.8(a). This notice will advise the reclamation debtor of
the amount demanded and the reason for the demand. Treasury will
provide notice to the reclamation debtor that:
(i) If the reclamation debt is not paid within 30 days after the
reclamation date, Treasury intends to collect the amount outstanding by
instructing the appropriate Federal Reserve Bank to debit on the 31st
day the Master Account used by the reclamation debtor. The Federal
Reserve Bank will provide advice of the debit to the reclamation
debtor;
(ii) The reclamation debtor has an opportunity to inspect and copy
Treasury's records with respect to the reclamation debt;
(iii) The reclamation debtor may, by filing a protest in accordance
with Sec. 240.9(b), request Treasury to review its decision that the
reclamation debtor is liable for the reclamation debt. If such a
protest is filed within 30 days after the reclamation date, Treasury
will not instruct the appropriate Federal Reserve Bank to debit the
Master Account used by the reclamation debtor while the protest is
still pending; and
(iv) The reclamation debtor has an opportunity to enter into a
written agreement with Treasury for the repayment of the reclamation
debt. A request for a repayment agreement must be accompanied by
documentary proof that satisfies Treasury that the reclamation debtor
is unable to repay the entire amount owed when due.
(2) Requests by a reclamation debtor for an appointment to inspect
and copy Treasury's records with respect to a reclamation debt and
requests to enter into repayment agreements must be sent in writing to
the address provided on the Check Claims Web site at https://www.fms.treas.gov/checkclaims or to such other address as Treasury may
publish in the Goldbook: The Check Reclamation Guide, which can be
found at https://www.fms.treas.gov.
(3) If Treasury determines a reclamation debt is due and the
Federal Reserve Bank is unable to debit the financial institution's
Master Account, FMS will assess interest, penalties, and administrative
costs in accordance with Sec. 240.8. Additionally, Treasury will
proceed to collect the reclamation debt through offset in accordance
with Sec. 240.10 and Treasury Check Offset in accordance with Sec.
240.11.
(4) If Treasury determines a reclamation has been made in error,
Treasury will abandon the reclamation. If Treasury already has
collected the amount of the reclamation from the reclamation debtor,
Treasury will promptly refund to the reclamation debtor the amount of
its payment.
(b) * * *
(3) Procedures for filing a protest. A reclamation protest must be
sent in writing to the address provided on the Check Claims Web site at
https://www.fms.treas.gov/checkclaims or to such other address as
Treasury may publish in the Goldbook: The Check Reclamation Guide,
which can be found at https://www.fms.treas.gov.
* * * * *
(ii) Treasury will not consider reclamation protests received more
than 60 days after the reclamation date.
* * * * *
(4) * * *
(iii) If the responsible FMS Director, or an authorized designee,
finds, by a preponderance of the evidence, the reclamation debtor is
liable for the reclamation debt, Treasury will notify the reclamation
debtor of his or her decision in writing. If the reclamation debtor has
not paid the reclamation in full, Treasury will direct the Federal
Reserve Bank to debit the financial institution's Master Account
immediately, provided at least 30 days have passed after the date of
the NOTICE OF DIRECT DEBIT (RECLAMATION). If at least 30 days have not
yet passed after the date of the NOTICE OF DIRECT DEBIT (RECLAMATION),
Treasury will direct the Federal Reserve Bank to debit the financial
institution's Master Account on the 31st day after the date of the
[[Page 57910]]
NOTICE OF DIRECT DEBIT (RECLAMATION). The Federal Reserve Bank will
provide advice of the debit to the reclamation debtor. If the
appropriate Federal Reserve Bank is unable to debit a reclamation
debtor's Master Account, Treasury will proceed to collect the
reclamation debt through offset in accordance with Sec. 240.10 and
Sec. 240.11.
* * * * *
Dated: September 12, 2011.
Richard L. Gregg,
Fiscal Assistant Secretary.
[FR Doc. 2011-23896 Filed 9-16-11; 8:45 am]
BILLING CODE 4810-35-P
